Border walls created in plastic de-fence

Plasticity

In the following article, Doug Woodring and Trish Hyde of Plasticity look at how the changing landscape surrounding the management of waste plastics is providing both puzzle, as well as opportunity.

Lines in the sand have now been drawn. Many Asian countries, who for a decade and more were the recipients of the developed world’s so-called “recyclables,” have now erected broad scale plastic defence mechanisms – essentially forming environmental trade barriers.

Modern economic trade theory has been enhanced by the belief that countries should become efficient in the skills and resources they can offer, while letting others excel where they have competitive advantages, with all parties trading accordingly so that economies of scale can be created, and repetition avoided.

This theory was widely adopted in the case of waste recovery and recycling, where labour costs in developed countries meant that on-shore solutions for processing did not happen at the same rate that trash was being created. Making matters worse was the fact that hollowed out manufacturing industries which also followed cheap labour and lax environmental standards meant that the local capacity to use recycled content in new products was minimised.

In addition to most of Asia saying they will not take any more materials for recycling, The Philippines and Malaysia have recently started sending waste back to their shores of origin. Countries that stand to lose heavily in the short term (until they greatly innovate their way to large scale domestic capacity building) include Canada, the U.S., Spain, Britain, Australia and Japan.

All of a sudden, the ideas of Extended Producer Responsibility (EPR) has evolved to global level, in the form of Extended Exporter Responsibility (EER). For those who have an ear on this issue, know that the plastic pollution puzzle is only going to get more complicated.

In fact, with good EER, plastic for recycling which is standardised, well monitored, governed and enforced, should be able to be traded to countries who have the ability to process and absorb (use) the materials. Closed borders, on the contrary, means that each country has to replicate resources, technical knowhow and capacities for each of their own waste management efficiencies, and this is not likely to happen for many years, or even decades to come.

Stranded assets of valuable waste resources will not be able to make it to processors that can use them, and poor domestic recovery of materials in most countries means that the entrepreneurs and innovators taking advantage of free trade and the New Trade Theory (with its focus onincreasing returns to scaleand the benefits of network effects),may not be able to easily find domestic feedstock to keep their machines running. This is also where opportunities lie, however.

Canada may be a leading example of turning this trade confrontation into a chance to truly focus and engage on the generation of its own, domestic circular economy. The EU is also making great inroads on circular economy activities, yet much more is needed if you actually remove the amount of “exported waste” from their definition of recycling.

Join us at Plasticity Amsterdam on 20 June for a big discussion on how some of the solutions needed to address these new plastic defences can be optimised for everyone involved.